Chapter Eight: Getting Started
“So what was the hitch?” I asked.
“Well, first we played your CASHFLOW game. We then had
a long discussion about the wise use of money. After that, I gave him
a subscription to the Wall Street Journal and a few books on the
stock market.”
“Then what?” I asked. “What was the catch?”
“I told him the $3,000 was his, but he could not directly buy a car
with it. He could use it to find a stockbroker and buy and sell stocks.
Once he had made $6,000 with the $3,000, the money would be his
for the car, and the $3,000 would go into his college fund.”
“And what are the results?” I asked.
“Well, he got lucky early in his trading, but lost everything a few
days later. Then he really got interested. Today, I would say he is down
$2,000, but his interest is up. He has read all the books I bought him,
and he’s gone to the library to get more. He reads the Wall Street Journal
voraciously, watching for indicators. He’s got only $1,000 left, but his
interest and learning are sky-high. He knows that if he loses that money,
he walks for two more years. But he does not seem to care. He even seems
uninterested in getting a car, because he’s found a game that is more fun.”
“What happens if he loses all the money?” I asked.
“We’ll cross that bridge when we get to it. I’d rather have him lose
everything now than wait till he’s our age to risk losing everything.
And besides, that is the best $3,000 I’ve ever spent on his education.
What he is learning will serve him for life, and he seems to have gained
a new respect for the power of money.”
As I said earlier, if a person cannot master the power of self-
discipline, it is best not to try to get rich. I say this because, although
the process of developing cash flow from an asset column is easy in
theory, what’s hard is the mental fortitude to direct money to the
correct use. Due to external temptations, it is much easier in today’s
consumer world to simply blow money out the expense column.
With weak mental fortitude, that money flows into the paths of
least resistance. That is the cause of poverty and financial struggle.
The following example illustrates the financial intelligence needed
to direct money to make more money.